This is part two of a two-part series. Part 1: “Not all golden at Golden Homes,” page A1, June 29 Herald.

POULSBO — Joan Brown, executive director of the Northwest Housing Association, said a contract for a manufactured home should include the cost of site preparation and installation.

That’s what Peter Miele of Kingston thought when he allowed Golden Homes owner Kelly Rohr to remove the old manufactured home from the view lot in Kingston, and took out a loan for a new home he planned to rent out.

The contract he signed said the total price was $65,160 for the home, setup and delivery. Miele thought he understood what setup and delivery meant.“He promised me a turnkey home,” Miele said. “It took a couple of months for me to get the loan and then I paid him cash. I wrote him a check for [$65,000]. That was two years ago.”

Two and a half months after Miele wrote the check, he visited Rohr at Golden Homes to ask why the house had not been installed. “I went in there after work one night and he lays this thing on me. ‘I need $12,500 to get the property ready to put the house on it.’ I told him it was the same size as the house that came off the site. I said, put it in the same spot. I had $2,000 in the bank and gave it to him. I said, ‘Will this get us started?’ ”

In an interview at Golden Homes on June 25, Rohr pulled Miele’s file and produced a five-page land development proposal, with estimated costs for excavation, concrete runners, tie downs, skirting, gutters, and riser caps for the septic system. Estimate: $12,400.

Miele initialed the cover page, on which it’s noted that he gave Rohr $2,000, which Rohr used for a site permit. But the last page, which is supposed to be initialed by the customer and contractor, is not initialed.

Today, steps lead up to a deck with no house. A sheet of Visqueen is laid over the house site. Utility pipes stick up out of the ground.

“He took my home away. I used to rent it out. I was going to rent (the new home) to my daughter and use it later as my retirement home. I still have the title for the house that he took,” Miele said. He doesn’t know where his old house is, but he knows where his new house is.

“The house that I bought is still down there (on the Golden Homes lot). He’s using it for a model.”

Miele said he hired a lawyer, who sent Rohr a letter that essentially said, “Deliver the house or give us our money back.” That was in fall 2010.

Meanwhile, Miele, an engineer with Washington State Ferries, has taken a second job to pay the mortgage on the house he bought but doesn’t have.

“I’m paying a mortgage and I’m paying for that loan. I’ve had some lean times where I was about to go out. I’m getting close to retirement age and I never figured on losing everything. It’s very stressful. You carry it around like cancer.”

Asked if he felt that he had been clear with Miele that there would be additional costs beyond delivery and setup when he signed the purchase agreement, Rohr said, “You can’t get 1,300 square feet of house with [$13,000] worth of site prep for $67,000.”

He added, “He paid for a house. He didn’t have the money to develop his property.”

Martha J. McMurray of Port Orchard bought a manufactured home from Golden Homes for her mother, who was ill. The contract price was $84,584 plus her travel-trailer as a trade-in. She signed the contract Aug. 22, 2007, he signed it Oct. 2.

“He was supposed to do all of the work — the foundation, driveway, ramp — but he didn’t,” she said June 19. “The home itself was nice. But he walked off the job. He didn’t finish it. I had to hire someone else to do the work all over again.”

Heating ducts were left laying on the ground, she said. There were no steps up to the back door. The ties were not done properly. He used plywood sheeting to skirt the home, instead of the concrete blocks specified in the contract.

McMurray hired an attorney, who contacted Rohr by letter. Rohr’s response: He was discontinuing all further work on the project. McMurray filed a complaint with state L&I.

At arbitration, in June 2009, McMurray was awarded $11,383 in damages plus attorney’s fees of $19,843, arbitration fees of $1,550, and $2,920 for an outside opinion of Rohr’s workmanship. That amount didn’t include what she had to pay a contractor to finish the work Rohr left behind.

“He still owes me $23,696.99,” McMurray said. “I have liens on his property.”

McMurray’s complaint, filed July 23, 2008, went to arbitration. Rohr’s bond paid McMurray $12,000, a portion of what she’s owed, on Dec. 21, 2009.  “He still owes me money — a lot of money,” she said. “His bond paid a little bit, then there were lawyer fees. It adds up.”

Of the McMurray case, Rohr said he made a mistake in not submitting change orders in writing.

Juanita DeLuna gave Rohr a $20,000 down payment toward a manufactured home and lot in Silverdale. The total price: $210,000. Minus 20 percent down — the $20,000 and a $20,000 note she has on a home she sold —  her loan would be for $170,000.

When she received a letter from Timberland Bank May 23 notifying her she didn’t qualify for a mortgage loan, she went back to Rohr and asked for her $20,000 back. She said he told her her loan had been approved by another bank, Cascade Mortgage, but she has received no such notification.

Rohr said DeLuna has a contractual obligation to seek financing. He said she chose not to apply for a loan with Cascade Mortgage after being turned down by Timberland Bank.

“In the contract, it says she has to actively seek financing. She was turned down by Timberland. Plan B, from day one, was Timberland is the best program, but if she doesn’t qualify we go to Cascade or 21st Century Mortgage. She doesn’t want to do the deal. Under the provision of loss of bargain, if you read the contract, it clearly states that the buyer cannot deliberately sabotage this deal.”

But DeLuna told the Herald she had consulted another mortgage company, which told her that her husband qualified for a loan of $150,000, $20,000 less than what Rohr’s contract called for.

Rohr said on June 22 that he mailed DeLuna a certified letter stating that she’s entitled to a refund of her down payment. As of July 5, she said she hadn’t received a letter. He said how much she receives depends on her communication with him; he says he can’t sell the house because DeLuna has a down payment on it.

“If she doesn’t want the house, she has to write me, give me some sense of direction of where she stands,” he said. “But if she just walks away, she’s entitled to $4,000” of the $20,000 down payment, because of losses he sustained in taking the house off the market.

Rohr said the economy has taken a toll on his business.

“Look at Viking Avenue. I’m the only dealer around and I’m a small guy. I’ve had to sell my equipment to survive. I still want to be here.” he said, referring to the loss of Poulsbo RV, Courtesy Ford and other auto dealers over the years.

He said customers need to read their contracts before they sign.

“When they sign these contracts, they take them home. I tell people, ‘Take it home, read it, if you have any questions let me know.’”